10-Q
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM 10-Q

 

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2023

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________________ to __________________

Commission File Number: 001-39979

 

VOR BIOPHARMA INC.

(Exact Name of Registrant as Specified in its Charter)

 

Delaware

81-1591163

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

100 Cambridgepark Drive, Suite 101

Cambridge, Massachusetts

02140

(Address of principal executive offices)

(Zip Code)

 

Registrant’s telephone number, including area code: (617) 655-6580

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading

Symbol(s)

 

Name of each exchange on which registered

Common Stock, $0.0001 par value per share

 

VOR

 

Nasdaq Global Select Market

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

Accelerated filer

 

 

 

 

Non-accelerated filer

Smaller reporting company

 

 

 

 

 

 

 

 

 

 

 

Emerging growth company

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No

Number of shares of the registrant’s Common Stock outstanding as of November 3, 2023 was 67,805,687.

 


 

Table of Contents

 

Page

PART I.

FINANCIAL INFORMATION

1

 

 

 

Item 1.

Financial Statements (Unaudited)

1

Condensed Consolidated Balance Sheets as of September 30, 2023 and December 31, 2022

1

Condensed Consolidated Statements of Operations and Comprehensive Loss for the Three and Nine Months Ended September 30, 2023 and 2022

2

 

Condensed Consolidated Statements of Stockholders’ Equity for the Three and Nine Months Ended September 30, 2023 and 2022

3

Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2023 and 2022

4

Notes to Condensed Consolidated Financial Statements (Unaudited)

5

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

11

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

19

Item 4.

Controls and Procedures

19

 

 

 

PART II.

OTHER INFORMATION

20

 

 

 

Item 1.

Legal Proceedings

20

Item 1A.

Risk Factors

20

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

20

Item 6.

Exhibits

21

 

Signatures

22

 

 

i


 

Note Regarding Company References

Throughout this Quarterly Report on Form 10-Q, the “Company,” “Vor,” “Vor Bio,” “Vor Biopharma Inc.,” “we,” “us,” and “our,” except where the context requires otherwise, refer to Vor Biopharma Inc. and its consolidated subsidiary, and “our board of directors” refers to the board of directors of Vor Biopharma Inc.

Special Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements that involve substantial risks and uncertainties. All statements, other than statements of historical facts, contained in this Quarterly Report on Form 10-Q, including statements regarding our strategy, future operations, future financial position, future revenue, projected costs, prospects, plans, and objectives of management, are forward-looking statements. In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “could,” “might,” “intend,” “target,” “ongoing,” “project,” “estimate,” “believe,” “estimate,” “predict,” “potential” or “continue” or the negative of these terms or other similar expressions intended to identify statements about the future. These statements speak only as of the date of this Quarterly Report on Form 10-Q and involve known and unknown risks, uncertainties and other important factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.

We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. These forward-looking statements include, without limitation, statements about:

the timing, progress and results of our preclinical studies and clinical trials of our product candidates, including statements regarding the timing and pace of initiation, enrollment and completion of studies or trials and related preparatory work, the period during which the results of the trials will become available and plans with respect to our research and development programs;
the timing and success of our in-house or third-party clinical manufacturing capabilities and efforts;
the timing of any submission of filings for regulatory approval of, and our ability to obtain and maintain regulatory approvals for, our product candidates for any indication;
our ability to identify patients with the diseases treated by our product candidates, and to enroll patients in trials;
our expectations regarding the market acceptance and opportunity for and clinical utility of our product candidates, if approved for commercial use;
our expectations regarding the scope of any approved indication for any product candidate;
our ability to successfully commercialize our product candidates;
our estimates of our expenses, ongoing losses, future revenue, capital requirements and our need for or ability to obtain additional funding;
our ability to establish or maintain collaborations or strategic relationships;
our ability to identify, recruit and retain key personnel, including executive officers and members of management;
our reliance upon intellectual property licensed from third parties and our ability to obtain such licenses on commercially reasonable terms or at all;
our ability to protect and enforce our intellectual property position for our product candidates, and the scope of such protection;
our financial performance;
the period over which we estimate our existing cash, cash equivalents and marketable securities will be sufficient to fund our future operating expenses and capital expenditure requirements;
our competitive position and the development of and projections relating to our competitors or our industry;
the impact of laws and regulations; and
our expectations regarding the time during which we will be an emerging growth company under the Jumpstart Our Business Startups Act of 2012.

You should read this Quarterly Report on Form 10-Q and the documents that we have filed as exhibits to this Quarterly Report on Form 10-Q completely and with the understanding that our actual future results may be materially different from what we

ii


 

expect. The forward-looking statements contained in this Quarterly Report on Form 10-Q are made as of the date of this Quarterly Report on Form 10-Q, and we do not assume any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. You should refer to the “Summary Risk Factors” and “Risk Factors” sections in our Annual Report on Form 10-K for the year ended December 31, 2022 for a discussion of material factors that could cause actual results or events to differ materially from the forward-looking statements that we make.

 

 

iii


 

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited).

VOR BIOPHARMA INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

 

 

 

September 30,

 

 

December 31,

 

(in thousands, except share amounts)

 

2023

 

 

2022

 

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

45,026

 

 

$

57,706

 

Marketable securities

 

 

115,072

 

 

 

172,539

 

Prepaid expenses

 

 

3,673

 

 

 

4,368

 

Other current assets

 

 

667

 

 

 

2,337

 

Total current assets

 

 

164,438

 

 

 

236,950

 

Restricted cash equivalents

 

 

2,413

 

 

 

2,413

 

Property and equipment, net

 

 

10,824

 

 

 

12,634

 

Operating lease right-of-use assets

 

 

41,262

 

 

 

44,444

 

Other assets

 

 

4,086

 

 

 

2,925

 

Total assets

 

$

223,023

 

 

$

299,366

 

Liabilities and stockholders’ equity

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

1,309

 

 

$

1,772

 

Accrued liabilities

 

 

10,274

 

 

 

7,889

 

Operating lease liabilities

 

 

3,743

 

 

 

3,272

 

Other current liabilities

 

 

62

 

 

 

186

 

Total current liabilities

 

 

15,388

 

 

 

13,119

 

Long-term liabilities:

 

 

 

 

 

 

Operating lease liabilities—non-current

 

 

32,854

 

 

 

35,640

 

Total liabilities

 

 

48,242

 

 

 

48,759

 

Stockholders’ equity:

 

 

 

 

 

 

Preferred stock, $0.0001 par value; 10,000,000 shares authorized as of September 30, 2023 and December 31, 2022; 0 shares issued and outstanding as of September 30, 2023 and December 31, 2022

 

 

 

 

 

 

Common stock, $0.0001 par value; 400,000,000 
    shares authorized as of September 30, 2023 and December 31, 2022;
   
67,798,343 and 66,079,597 shares issued and
   
67,785,469 and 65,996,138 outstanding as of September 30, 2023 and
   December 31, 2022, respectively

 

 

7

 

 

 

7

 

Additional paid-in capital

 

 

488,873

 

 

 

473,587

 

Accumulated other comprehensive loss

 

 

(280

)

 

 

(770

)

Accumulated deficit

 

 

(313,819

)

 

 

(222,217

)

Total stockholders’ equity

 

 

174,781

 

 

 

250,607

 

Total liabilities and stockholders’ equity

 

$

223,023

 

 

$

299,366

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

1


 

VOR BIOPHARMA INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(UNAUDITED)

 

 

 

Three Months Ended
September 30,

 

 

 

Nine Months Ended
September 30,

 

(in thousands, except share and per share amounts)

 

2023

 

 

2022

 

 

 

2023

 

 

2022

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

$

27,606

 

 

$

16,875

 

 

 

$

73,418

 

 

$

47,488

 

General and administrative

 

 

7,710

 

 

 

7,226

 

 

 

 

24,494

 

 

 

21,205

 

Total operating expenses

 

$

35,316

 

 

$

24,101

 

 

 

$

97,912

 

 

$

68,693

 

Loss from operations

 

$

(35,316

)

 

$

(24,101

)

 

 

$

(97,912

)

 

$

(68,693

)

Other income:

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

2,126

 

 

 

313

 

 

 

 

6,310

 

 

 

509

 

Total other income

 

 

2,126

 

 

 

313

 

 

 

 

6,310

 

 

 

509

 

Net loss

 

$

(33,190

)

 

$

(23,788

)

 

 

$

(91,602

)

 

$

(68,184

)

Net loss per share attributable to common stockholders,
   basic and diluted

 

$

(0.49

)

 

$

(0.63

)

 

 

$

(1.37

)

 

$

(1.81

)

Weighted-average common shares outstanding,
   basic and diluted

 

 

67,607,713

 

 

 

38,009,022

 

 

 

 

66,973,771

 

 

 

37,582,463

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive income (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized gain (loss) on available for sale investments

 

 

156

 

 

 

148

 

 

 

 

490

 

 

 

(1,178

)

Total other comprehensive income (loss)

 

 

156

 

 

 

148

 

 

 

 

490

 

 

 

(1,178

)

Comprehensive loss

 

$

(33,034

)

 

$

(23,640

)

 

 

$

(91,112

)

 

$

(69,362

)

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

2


 

Vor Biopharma Inc.

CONDENSED CONSOLIDATED Statements of stockholders’ EQUITY

(Unaudited)

 

 

 

Common
Stock

 

 

Additional
Paid-In

 

 

Accumulated other comprehensive

 

 

Accumulated

 

 

Total
Stockholders’ Equity

 

(in thousands, except share amounts)

 

Shares

 

 

Amount

 

 

Capital

 

 

loss

 

 

Deficit

 

 

(Deficit)

 

Balance at December 31, 2022

 

 

65,996,138

 

 

$

7

 

 

$

473,587

 

 

$

(770

)

 

$

(222,217

)

 

$

250,607

 

Issuance of common stock upon vesting of RSUs and exercise of stock options, net of shares withheld for taxes

 

 

205,485

 

 

 

 

 

 

(340

)

 

 

 

 

 

 

 

 

(340

)

Issuance of common stock from open market sales agreement

 

 

733,274

 

 

 

 

 

 

3,717

 

 

 

 

 

 

 

 

 

3,717

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

4,068

 

 

 

 

 

 

 

 

 

4,068

 

Other comprehensive income

 

 

 

 

 

 

 

 

 

 

 

596

 

 

 

 

 

 

596

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(28,433

)

 

 

(28,433

)

Balance at March 31, 2023

 

 

66,934,897

 

 

$

7

 

 

$

481,032

 

 

$

(174

)

 

$

(250,650

)

 

$

230,215

 

Issuance of common stock upon vesting of RSUs, vesting and exercise of stock options, and issuance of common stock from ESSP, net of shares withheld for taxes

 

 

381,775

 

 

 

 

 

 

(317

)

 

 

 

 

 

 

 

 

(317

)

Issuance of common stock from open market sales agreement

 

 

116,888

 

 

 

 

 

 

555

 

 

 

 

 

 

 

 

 

555

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

4,238

 

 

 

 

 

 

 

 

 

4,238

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

(262

)

 

 

 

 

 

(262

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(29,979

)

 

 

(29,979

)

Balance at June 30, 2023

 

 

67,433,560

 

 

$

7

 

 

$

485,508

 

 

$

(436

)

 

$

(280,629

)

 

$

204,450

 

Issuance of common stock upon vesting of RSUs, vesting and exercise of stock options, net of shares withheld for taxes

 

 

219,409

 

 

 

 

 

 

(183

)

 

 

 

 

 

 

 

 

(183

)

Issuance of common stock from open
    market sales agreement

 

 

132,500

 

 

 

 

 

 

386

 

 

 

 

 

 

 

 

 

386

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

3,162

 

 

 

 

 

 

 

 

 

3,162

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

156

 

 

 

 

 

 

156

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(33,190

)

 

 

(33,190

)

Balance at September 30, 2023

 

 

67,785,469

 

 

$

7

 

 

$

488,873

 

 

$

(280

)

 

$

(313,819

)

 

$

174,781

 

 

 

 

 

Common
Stock

 

 

Additional
Paid-In

 

 

Accumulated other comprehensive

 

 

Accumulated

 

 

Total
Stockholders’
Equity

 

(in thousands, except share amounts)

 

Shares

 

 

Amount

 

 

Capital

 

 

loss

 

 

Deficit

 

 

(Deficit)

 

Balance at December 31, 2021

 

 

37,174,741

 

 

$

4

 

 

$

346,382

 

 

$

 

 

$

(130,123

)

 

$

216,263

 

Issuance of common stock upon vesting and exercise of stock options

 

 

161,573

 

 

 

 

 

 

247

 

 

 

 

 

 

 

 

 

247

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

1,746

 

 

 

 

 

 

 

 

 

1,746

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

(1,072

)

 

 

 

 

 

(1,072

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(22,737

)

 

 

(22,737

)

Balance at March 31, 2022

 

 

37,336,314

 

 

$

4

 

 

$

348,375

 

 

$

(1,072

)

 

$

(152,860

)

 

$

194,447

 

Issuance of common stock upon vesting and exercise of stock options

 

 

74,358

 

 

 

 

 

 

146

 

 

 

 

 

 

 

 

 

146

 

Issuance of common stock from open market sales agreement

 

 

95,564

 

 

 

 

 

 

553

 

 

 

 

 

 

 

 

 

553

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

1,741

 

 

 

 

 

 

 

 

 

1,741

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

(254

)

 

 

 

 

 

(254

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(21,659

)

 

 

(21,659

)

Balance at June 30, 2022

 

 

37,506,236

 

 

$

4

 

 

$

350,815

 

 

$

(1,326

)

 

$

(174,519

)

 

$

174,974

 

Issuance of common stock upon vesting
    and exercise of stock options

 

 

126,509

 

 

 

 

 

 

279

 

 

 

 

 

 

 

 

 

279

 

Issuance of common stock from open
    market sales agreement

 

 

760,466

 

 

 

 

 

 

3,792

 

 

 

 

 

 

 

 

 

3,792

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

3,329

 

 

 

 

 

 

 

 

 

3,329

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

148

 

 

 

 

 

 

148

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(23,788

)

 

 

(23,788

)

Balance at September 30, 2022

 

 

38,393,211

 

 

$

4

 

 

$

358,215

 

 

$

(1,178

)

 

$

(198,307

)

 

$

158,734

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

3


 

Vor Biopharma Inc.

condensed CONSOLIDATED StatementS of Cash Flows

(unaudited)

 

 

 

Nine Months Ended
September 30,

 

(in thousands)

 

2023

 

 

2022

 

Cash flows from operating activities

 

 

 

 

 

 

Net loss

 

$

(91,602

)

 

$

(68,184

)

Adjustments to reconcile net loss to net cash used in operations:

 

 

 

 

 

 

Depreciation expense

 

 

2,600

 

 

 

1,893

 

Non-cash lease expense

 

 

3,513

 

 

 

2,451

 

Stock-based compensation

 

 

11,468

 

 

 

6,816

 

Interest (amortization) accretion on marketable securities

 

 

(3,674

)

 

 

163

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

Operating lease liabilities, net

 

 

(2,646

)

 

 

(9,037

)

Prepaid expenses and other current assets

 

 

2,558

 

 

 

316

 

Accounts payable and accrued liabilities

 

 

2,678

 

 

 

(542

)

Other assets

 

 

(1,161

)

 

 

(674

)

Net cash used in operating activities

 

 

(76,266

)

 

 

(66,798

)

Cash flow from investing activities

 

 

 

 

 

 

Purchases of marketable securities

 

 

(58,369

)

 

 

(5,044

)

Proceeds from maturities of marketable securities

 

 

120,000

 

 

 

16,130

 

Purchases of property and equipment

 

 

(958

)

 

 

(8,141

)

Net cash provided by investing activities

 

 

60,673

 

 

 

2,945

 

Cash flow from financing activities

 

 

 

 

 

 

Payment of issuance costs related to underwritten public offering and concurrent private placement

 

 

(717

)

 

 

 

Proceeds from the issuance of common stock from at-the-market sales agreement, net of issuance costs

 

 

4,593

 

 

 

4,345

 

Shares repurchased for tax withholdings upon vesting of restricted stock unit awards

 

 

(1,165

)

 

 

 

Proceeds from stock option exercises and the issuance of shares under ESPP

 

 

202

 

 

 

534

 

Net cash provided by financing activities

 

 

2,913

 

 

 

4,879

 

Net decrease in cash, cash equivalents and restricted cash equivalents

 

 

(12,680

)

 

 

(58,974

)

Cash, cash equivalents and restricted cash equivalents,
   beginning of period

 

$

60,119

 

 

$

122,214

 

Cash, cash equivalents and restricted cash equivalents, end of period

 

$

47,439

 

 

$

63,240

 

Supplemental disclosure of non-cash activities

 

 

 

 

 

 

Right-of-use assets obtained in exchange for lease obligations

 

$

37

 

 

$

24,207

 

Purchases of property and equipment in accounts payable and accrued liabilities

 

$

63

 

 

$

56

 

Financing costs associated with the sale of common stock included in accounts payable and accrued expenses

 

$

30

 

 

$

 

 

A reconciliation of the cash, cash equivalents and restricted cash equivalents reported within the condensed consolidated balance sheets that sums to the total of the same amounts shown in the statements of cash flows is as follows:

 

 

 

September 30,

 

(in thousands)

 

2023

 

 

2022

 

Cash and cash equivalents

 

$

45,026

 

 

$

60,827

 

Restricted cash equivalents

 

 

2,413

 

 

 

2,413

 

Total cash, cash equivalents and restricted cash equivalents as shown on the
   statements of cash flows

 

$

47,439

 

 

$

63,240

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

4


 

 

VOR BIOPHARMA INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

1. Nature of the Business

Vor Biopharma Inc. (the “Company”) is a clinical-stage cell and genome engineering company that combines a novel patient engineering approach with targeted therapies to provide a single company solution for patients suffering from hematological malignancies. The Company’s proprietary platform leverages its expertise in hematopoietic stem cell (“HSC”) biology, genome engineering and targeted therapy development to genetically modify HSCs to remove surface targets expressed by cancer cells. The Company is headquartered in Cambridge, Massachusetts. The Company was incorporated on December 30, 2015.

Risks and Uncertainties

The Company is subject to a number of risks common to development stage companies in the biotechnology industry, including, but not limited to, risks of failure of preclinical studies and clinical trials, dependence on key personnel, protection of proprietary technology, reliance on third party organizations, risks of obtaining regulatory approval for any product candidate that it may develop, development by competitors of technological innovations, compliance with government regulations, geopolitical tensions, adverse macroeconomic conditions and the need to obtain additional financing.

The Company anticipates that it will continue to incur significant operating losses for the next several years as it continues to develop its product candidates. The Company believes that its existing cash, cash equivalents and marketable securities at September 30, 2023 will be sufficient to allow the Company to fund its current operations through at least a period of one year after the date the financial statements are issued.

2. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). Certain comparative amounts have been reclassified to conform to the current period presentation. Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification and Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”).

Use of Estimates

The preparation of the condensed consolidated financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the condensed consolidated financial statements and the reported amount of expenses during the reporting period. Actual results could differ from those estimates. Management considers many factors in selecting appropriate financial accounting policies in developing the estimates and assumptions that are used in the preparation of the condensed consolidated financial statements. Management must apply significant judgment in this process. Management’s estimation process often may yield a range of potentially reasonable estimates and management must select an amount that falls within that range of reasonable estimates. Estimates are used in the following areas, among others: accrued expenses and research and development expenses.

Unaudited Interim Financial Information

The condensed consolidated financial statements of the Company included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary. All intercompany transactions and balances have been eliminated in consolidation. In the opinion of management, the information furnished reflects all adjustments, all of which are of a normal and recurring nature, necessary for a fair presentation of the results for the reported interim periods. The results of operations for interim periods are not necessarily indicative of results to be expected for the full year or any other interim period.

The accompanying condensed consolidated balance sheet as of December 31, 2022 has been derived from the Company’s audited consolidated financial statements for the year ended December 31, 2022. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to rules and regulations. However, the Company believes that the disclosures are adequate to make the information presented not misleading. These unaudited interim condensed consolidated financial statements should be read in conjunction with the audited annual

5


 

consolidated financial statements and notes in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 (the “2022 Annual Report”).

During the nine months ended September 30, 2023, there have been no changes to the Company’s significant accounting policies as described in the 2022 Annual Report.

3. Marketable Securities

The amortized cost and estimated fair value of marketable securities, by contractual maturity are as follows:

 

 

September 30, 2023

 

(in thousands)

 

Amortized Cost

 

 

Gross Unrealized Holding Gains

 

 

Gross Unrealized Holding Losses

 

 

Fair Value

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Maturing in one year or less

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasuries

 

$

115,352

 

 

$

1

 

 

$

(281

)

 

$

115,072

 

Total

 

$

115,352

 

 

$

1